Introduction I want to start by saying thank you for taking time out of your busy day to read this valuable report.
My goal is to educate you as to the biggest mistakes I see working with small business owners, as their bookkeeper. I want you to avoid these bookkeeping mistakes so that you can earn more, pay less in taxes and have peace of mind knowing your books and finances are in order. I’ve been the unfortunate witness of many disasters when it comes to bookkeeping. When I am called in to help a business, the bookkeeping situation can be chaotic and stressful for the business owner.
However, the good news is that, within a relatively short period of time, I am able to restore order and bring peace of mind back to the owners. I don’t want bookkeeping and financial chaos or stress to be a part of your life! Please read these mistakes and see if they sound familiar to you. If you are making these mistakes that’s ok: there are easy to follow solutions to go along with each mistake.
One word of caution: great solutions, in the hands of an unskilled bookkeeper can actually make things worse. No matter what you gather from this report, get REAL help. Whether from myself or another qualified bookkeeper, just make sure your bookkeeper knows the tricks of the bookkeeping trade as they relate to your business.I serve small business owners exclusively as their bookkeeper and trusted advisor. If, after reading this report, you feel you need help applying the recommended solutions, I encourage you to make an appointment with me to discuss your situation. I offer free consultations to help small business owners discover how to move beyond chaos and restore order to their business.
To schedule your free consultation, visit www.threeriversbookkeeping.com/contact. I am a bookkeeper, which means I am not a salesperson.
I will shoot straight with you about your situation and if we decide to move forward, then that is fine. If not, that is fine too. Mistake #1: Not Having A Budget And Monitoring It Explanation The number one differentiator between an excellent and an average performing small businesses is the use and implementation of a budget. I know the word “budget” sounds boring and mundane but trust me, the businesses that experience growth and obtain financial success are all using a budget.Small business owners that are using budgets take it seriously.
They incorporate the budget into their bookkeeping software, monitor it on a monthly basis and adjust their finances accordingly to ensure they reach their goals outlined in the budget. Solution Develop a budget. Work with someone who understands small businesses. Review the budget on a regular basis and create a new budget once a year. Mistake #2: Missing Legitimate Tax Deductions Explanation A lot of small businesses are missing out on legitimate tax breaks because they just don’t know. And, hey, it’s not their (or your) fault. You started your business because you knew the industry and had a product or service that your customers needed and wanted. How much time did you spend learning about taxes, bookkeeping and financial matters? This lack of knowledge can cost you a lot of money and many sleepless nights over the course of your career.
Don’t let this happen to you. Solution Develop a bookkeeping system designed to capture every tax break possible. This system needs to be tailored for you as a small business owner.
You see, you have unique tax breaks that aren’t common among other businesses. The way we design our bookkeeping systems for our clients makes it difficult to miss out on tax breaks. You and your accountant will love the way this functions. And the best part is you know you’re capturing tax breaks in real time. Mistake #3: Loose Or No Controls On Your Bookkeeping, Financial And Banking Processes Explanation This can be a scary one. The business owner hands over control of their bookkeeping, financial and banking processes to one employee or manager.
More often than not, there are loose or no controls so if, heaven forbid, you end up with an unhappy employee…I don’t even want to finish the sentence. Don’t believe me? Google “Employee Embezzlement” and read through the 100s of cases that happen each year. Solution Set up sound bookkeeping, financial and banking controls within your business. For example, no one other than you should have access to the banking records whether online or paper. Have your businesses bank statements sent to your home address if you’re using snail mail or delivered to your PRIVATE email inbox if you receive them in electronic form. Doesn’t that sound like a simple fix? It is! Apply this, along with the other financial controls I recommend, and you make it much more difficult for anyone to steal from you.
However, even with these controls in place, there are more important things you need to consider as it relates to employee embezzlement and internal controls. That is a topic I do NOT want in writing as it gives thieves an understanding of what to be on the lookout for. If you like, please schedule your free consultation and I will discuss this with you in private.
Mistake #4: Pretending That Bookkeeping Doesn’t Exist And “Doing The Books” Once Per Year Explanation How many business owners have had this thought? “I’ll do my job of being a great business owner and everything else (the bookkeeping and the finances) will work itself out. There is not a good ending to a story where the books and the finances were ignored within a business. This kind of thinking will eventually catch up to you and the consequences vary by the length of time the books were left to sort themselves out. Now, this does NOT mean you need to go back and get a degree in business or finance.Solution First off, find a professional who can teach you the what it takes to run your businesses finances. Second, find someone to take over all of the routine bookkeeping and accounting matters.
Third, review this person’s work on a regular basis. If this person has done a good job in teaching you how to run your businesses finances then you will be able to tell the difference between care and carelessness. Mistake #5: Allowing Someone Unqualified To Do The Bookkeeping Explanation I asked one business owner who was doing their books. She Looked down at her shoes and told me that her office manager was responsible for handling the books. Hoping for the best, I replied: “Oh, good, she must know what she’s doing and have some background in bookkeeping.
” From the look on her face, I could tell my hope was not what was really going on. It turns out, this office manager had made a mess of the books. Problem was, the owner didn’t know how to fix it so she just let it ride. No funny business going on; the office manager was doing the best she could, it just was a royal mess. Solution Would you allow your office manager to invest your retirement funds? How about your kid’s college education fund? I hope you would say “No”! However, when we allow the office manager or any other unqualified individual to manage the bookkeeping, in effect, you’re putting them in charge of the largest investment you have in your portfolio. The solution is simple: hire a trained professional to care for the bookkeeping. Mistake #6: Keeping Incomplete, Non-Existent Or Outdated Books Explanation This usually is coupled with mistakes #4 and #5. Over the course of the year, you turn a blind eye to the books and hope nothing bad happens.
At the end of the year, all of your banking and “bookkeeping” records (a big box full of receipts) are turned over to your accountant at tax time to let them deal with it. After all, who has time for that mess? In the long run, this is costing you LOTS of money and unneeded stress.Solution The most likely reason for this is that you or someone within your practice is responsible for this activity along with about 20 other more pressing matters. It’s important to hire someone whose sole function is to care for the books. This not only keeps you prepared for tax time but allows you to see the financial health of the business on a regular basis. Businesses that know where their business stands financially are the businesses that are succeeding and thriving.
Mistake #7: Using A General Bookkeeper Explanation As mentioned before, your business is unique and there is no one business that is identical to yours. Most of bookkeeping is the same for any business whether is a chiropractic practice or an ice cream truck. But…the last few percent is what separates the great from the mediocre. Solution Hire a bookkeeper who knows the ins and outs of small business bookkeeping. Hire a professional who knows what it takes for you to succeed.
Now is not the time to try to cut costs and go for the cheapest option, these are your finances we are talking about and the life blood of your business. Surprisingly, getting this kind of dedicated help is reasonable and will actually become a profit center for you rather than a cash drain. Conclusion I’ve got to be honest with you: I will set up your business for financial success and monitor it every step of the way. Every one of the mistakes and solutions I just informed you about, I tackle on a daily basis. Now, I would like the opportunity to talk about your specific business situation and how I can serve and guide you toward financial stability and success. If you’d like to take me up on this offer, please email me at [email protected] or call me at 907-331-0208 for your free consultation. If you don’t contact me, that’s totally fine and I completely understand.
But please do one thing for yourself and find a qualified bookkeeper to set up the books for your business. Don’t make the same mistakes I’ve seen so many other business owners make! They are unnecessary and it breaks my heart to see small business owners missing out on the benefits that come from gaining financial control of their business. I hope this has been helpful and inspires you to take action. Natalie ParisThe Small Business Bookkeeper